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Last Updated: Jul 09, 2009

Property prices continue to plummet in Trinidad and Tobago

After enormous price increases from 1991 to 2006, Trinidad and Tobago’s property market suddenly cooled, and has been falling for the past two years. In the first half of 2009, property prices and transactions fell further, as both local and foreign demand plummeted.

In 2008, the median house price dropped by 9% to about TT$1,000,000 (US$164,474) from a year earlier, according to figures from the Central Bank of Trinidad and Tobago (CBTT). When adjusted for inflation, the median house price actually plunged by about 19% over the same period.

"As the wider economy contracts so too does the real estate industry,” said Richard Saunders, president of the Association of Real Estate Agents (AREA). "Real estate rentals and sales in the West have dropped while there remains no movement in the East.”
Property prices in the islands rose by a spectacular 477% (157% in real terms) from 1991 to 2006. This was primarily due to strong economic growth fuelled by buoyant petroleum, tourism and construction sectors.

In Trinidad, foreigners can freely buy up to one acre for residential purposes without a license. In Tobago, foreigners must first obtain a license to acquire land for any purpose due to the new law known as the Foreign Investment Tobago Land Acquisition Order 2007, which effectively shut down the market.

Read Price History  »

RENTAL YIELDS

Last Updated: Dec 13, 2007

Trinidad apartments generate good yields

Yields on apartments in North Trinidad average 7.78%, selling for US$3,158 per sq. m. Townhouses, on the other hand, are cheaper at roughly US$2,464 per sq. m with higher yields at 8.36%.

House prices are set according to the number of bedrooms. Prices start at US$400,000 for two-bedroom houses, and can reach up to almost US$1 million for houses with five bedroom or more. Yields are comparably lower at 7.6%, but are still good.

Read Rental Yields  »

TAXES AND COSTS

Last Updated: Jan 20, 2009

Rental income tax is very high

Rental Income: Rental income is taxed at a flat rate of 25%.

Property: Land tax is imposed at around TTD10 (US$1.61) per acre of land, and building tax is levied at 7.5% of the property’s annual capital value.

Capital Gains: No capital gains tax is levied, except on properties sold within one year of acquisition.

Inheritance: There are no inheritance taxes in the islands.

Residents: Residents are taxed on worldwide income.

Read Taxes and Costs  »

BUYING GUIDE

Last Updated: Mar 31, 2008

Buying costs range from moderate to high in Trinidad and Tobago

Roundtrip transaction costs range from 9% to 18.5% of the property's value. The wide variation is mainly due to stamp duty at 5% to 10% with the first TTD450,000 tax-exempt. The realtor’s fee is around 3% to 5% paid by the seller.

Buyer and seller pay for their own lawyer. Legal fees are at 0.5% - 1.5%, plus 15% VAT.

Read Buying Guide  »

LANDLORD AND TENANT

Last Updated: Jun 15, 2006

In Trinidad and Tobago, law is pro-tenant

Rent Control: Rents can be freely agreed, except for very small rentals covered by the Rent Restriction Act.

Tenant Security: The landlord needs an eviction notice from the courts to evict a tenant. It takes an average of 192 days to evict a tenant in Trinidad and Tobago, according the the Lex Mundi project.

Read Landlord and Tenant  »

ECONOMIC GROWTH

Last Updated: Jul 09, 2009

Economic slowdown

Trinidad and Tobago (pop. 1.3 million) has an ecological and geographical diversity that is truly unmatched in the Caribbean region.

Trinidad is a large and thriving island, its capital Port of Spain being densely populated, highly developed and industrialized.

Tobago is undeveloped and truly a natural paradise with its palm-lined sandy beaches, pristine coral reefs teeming with marine life, and lush rainforests.

Trinidad and Tobago merged in 1888 to form a single British colony, and became an independent member of the British Commonwealth in 1962. It finally became the Republic of Trinidad and Tobago in 1976.

Trinidad and Tobago has one of the highest per capita incomes in the Caribbean region, with GDP per capita of more than TT$119,000 (US$19,000) in 2008. It was also one of the fastest growing economies in the region, with an average GDP growth rate of 8.1% from 1997 to 2007.

However, economic growth slowed to 3.4% in 2008, as the adverse impact of the global crisis spreads. The economy is projected to grow by just 0.5% in 2009.

CL Financial Group, the largest privately held conglomerate in the country, collapsed in January 2009 due to financial problems. The stock market declined sharply. Some steel and iron plants have also been shutdown. Construction activity has ground to a halt.

 

  • High yields in Tobago
  • Strong economic growth
  • Very high rental income tax
  • Moderate to high transaction costs
  • Pro-tenant rental market

RESIDENTIAL PROPERTY FACTS
Price (sq.m): $3,091 For a 120 sq. m. property, usually an apartment. Rental Yield: 8.14% For a 120 sq. m. property, usually an apartment.
Rent/month: $2,516 For a 120 sq. m. property. Income Tax: n.a. Assumptions: Owners are a non-resident couple drawing US$ / €1,500 per month in rent, with no other local income.
Roundtrip Cost: 13.2% The total cost of buying and then reselling an apartment. Includes:

* all transaction taxes and charges:
* lawyers' and notaries' fees
* agents' fees

Assumptions: The buyers are non-resident foreigners. The apartment cost US$250,00 / €250,000. 		Cap Gains Tax: 0.0 Assumptions: The property was bought for US$250,000 / €250,000, and sold 10 years later, after a 100% appreciation.
Landlord & Tenant Law: Pro-Tenant Rating is based on a detailed study of each country’s law and practice.
NOVEMBER 2008
OCTOBER 2006
SEPTEMBER 2006
AUGUST 2006

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